Encourage Domestic Production of Rare Earth and Other Critical Elements U.S. Relies on for Military Equipment, High Tech

Texas Insider Report: WASHINGTON, D.C. –U.S. Sen. Ted Cruz (R-Texas), member of the Senate Foreign Relations Committee, today introduced the Onshoring Rare Earths Act of 2020 or ORE Act, legislation to end U.S. dependence on China for rare earth elements and other critical minerals used to manufacture our defense technologies and high tech products by establishing a supply chain for these minerals in the U.S., including by requiring the U.S. Department of Defense (DOD) to source these minerals domestically.

Upon introducing the legislation, Sen. Cruz said:

“Our ability as a nation to manufacture defense technologies and support our military is dangerously dependent on our ability to access rare earth elements and critical minerals mined, refined, and manufactured almost exclusively in China. Much like the Chinese Communist Party has threatened to cut off the U.S. from life-saving medicines made in China, the Chinese Communist Party could also cut off our access to these materials, significantly threatening U.S. national security. The ORE Act will help ensure China never has that opportunity by establishing a rare earth elements and critical minerals supply chain in the U.S.”

Background
In December 2017, Presidential Executive Order (EO) 13817, “A Federal Strategy to Ensure Secure and Reliable Supplies of Critical Minerals,” tasked the Department of the Interior (DOI) to coordinate with other executive branch agencies to publish a list of critical minerals. The Department of the Interior published a final list of 35 critical minerals in May 2018.

Within that list are 17 rare earth elements (REEs), which are primarily used in high-tech and military applications and especially for magnets, and another 4 critical minerals that have become necessary to meet electric vehicle demand (cobalt, graphite, manganese, and lithium).

Over the last few decades the Chinese government worked with their companies to systematically drive competitors out of the market, and centralize the supply chain in China.

The ORE Act is designed to reduce U.S. dependence on China and establish a supply chain for rare earth elements and critical minerals in the U.S. Specifically, the legislation 1) provides tax incentives for the rare earths industry, including expanding and making permanent full-expensing provisions in the Tax Cuts and Jobs Act, 2) requires the DOD to source rare earth minerals and critical elements from the U.S., and 3) establishes grants for pilot programs to develop these materials in the U.S.

Sen. Cruz has been leading efforts to unwind the U.S. from China in light of the coronavirus pandemic. As Sen. Cruz said earlier this month:

“The most important long term national security and foreign policy consequence of this coronavirus pandemic is going to be a fundamental reassessment of the United States’ relationship with China.I believe China is the most significant geopolitical threat to the United States for the next century, and I have been saying that for years. Many in Washington have not been interested in hearing it or have refused to listen. I think this coronavirus pandemic has opened the eyes of many in Congress, many in Washington, and even some in the media.”